To reach an economically efficient output level, the size of an excise tax imposed on a firm generating a negative externality should be
a. the firm's marginal cost.
b. the social marginal cost.
c. the difference between the social marginal cost and the firm's marginal cost.
d. the sum of the social marginal cost and the firm's marginal cost.
c
Economics
You might also like to view...
The SAS curve shifts if there is a change in
A) the price level. B) real GDP. C) nominal GDP. D) potential GDP.
Economics
To have a rising standard of living, a nation's stock of capital must
a. equal the amount of consumption in the country b. grow faster than the population c. be associated with a low rate of investment and high rate of consumption d. grow slower than the population e. decline to enable the production of essential consumption goods
Economics